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Monday, March 06, 2006

Publishing and digital change: what's next?

Mike Shatzkin has been identified here before (April 21 2005) as one of the smartest brains in the book world. He is the Founder & CEO of The Idea Logical Company and of BaseballLibrary.com. He has four decades of experience as a published writer and working in all aspects of the publishing industry -- writing, editing, agenting, selling, marketing, and managing production. This makes him well positioned to look into the crystal ball.

Fortunately for the rest of us, Shatzkin occasionally gives presentations in which he sets out his conclusions about the book world as it now as, and as he sees it developing. The perspective is mainly North American, but he certainly has a good feel for the UK market; and, as the book business is in any case global these days (one of his points), the nationality of the thinker is not as important as it once was.

Shatzkin's latest thoughts -- Publishing and digital change: what's next? -- were presented in a speech to the Association of Book Publishers of British Columbia. They are available online (link from Publishers Lunch), and for anyone with any serious interest, or ambitions, in the book business, they well repay study. Be aware, however, that when printed out the speech runs to 15 single-spaced A4 pages and takes a good half hour to absorb.

I'm not going to attempt to precis the Shatzkin piece. You are recommended, as I say, to absorb the thrust of it yourself. But here are a few comments on the thoughts of Chairman Mike.

He points out that, in the late 1990s, the idea that Publishers Lunch might become more important than Publishers Weekly would have seemed laughable. Well not to me it wouldn't. As an Englishman I subscribed to the US Publishers Weekly for many years, and at great expense. To begin with I learnt a lot, but I came to see it as terrified of offending anybody, lacking any hint of humour, and politically correct beyond endurance. It was typical, I thought, of an industry which seemed determined to avoid change at all costs. Even death.

The thing that really killed PW for me was its report of the Joan Collins case. During this 1996 hearing, a number of publishing bigwigs made themselves look extremely foolish, and I was hoping that PW would have a little fun with it, running to two or three pages, including some backstage scuttlebutt. But no. What we got was about a column of absolutely po-faced factual reporting, dull as you-know-what (careful avoidance of cliche). God forbid that they should ever offend, criticise, or make fun of an advertiser.

Well fuck you, PW, I thought, and I did not renew my extremely expensive subscription. I doubt if matters have improved any in the last ten years, but you can try your luck on the web site if you wish.

The reason why I go on about this at some length is that PW is the flagship journal of the book industry in the US, the world's biggest and richest book market. You can tell a lot about the tone of an industry from what such a journal is like. And at least the Bookseller, the UK equivalent, has a sense of humour.

Shatzkin is honest enough to admit that he is not always right. In particular, he was wrong to think that ebooks were going to take off in a big way; although he remains confident that the take-off will occur one day. Others made similar mistakes. In the 1995-2000 period, a number of digital or web-based book-marketing initiatives were launched, and they virtually all lost money: sometimes millions. This experience explains, but does not, in my opinion, excuse, the book world's current caution about all things digital.

Another thing which is often overlooked by the as-yet-unpublished writers of fiction, and by readers of same, is that most of publishing is non-fiction. Furthermore, it is the deadly dull bits of publishing which tend to make serious money: textbooks, hymn books, how-to, reference books which need to be bought each year, and so forth. It's worth remembering that the up-front, in-your-face stuff which fills the glossy magazines is often the side of publishing which is bleeding money.

A further point to bear in mind is that publishing tends to conform with the 'power-law distribution'. Power law says that the top titles get a bigger and bigger share of total sales. This tendency has ceased to grow, so to speak, in 2005, but this may be a temporary phenomenon.

One of Shatzkin's major conclusions is that the market for traditional books is declining, and the only way for publishers to make profits will be to become more efficient. Well, you can interpret the phrase 'greater efficiency' in many ways, and possibly bring it about in many ways. But my guess is that one popular way of achieving it will be to pay writers less.

When I say 'writers' I have in mind the little guys, because they have the least clout in the marketplace. There are, after all, quite a few perfectly competent novelists paying good money to get their books into print, so why pay very much for the 'long-tail' fiction?

As for the really big fiction writers, Shatzkin has some interesting comments. He implies that publishers are currently overpaying them. And goodness knows, he is one of the few people in a position to know. (See Tess Gerritsen's remarks in my earlier post today.) If this practice ceases, he says, the big names will find it more profitable to 'do it themselves'. He adds: 'If publishers respond to changing circumstances sensibly -- and cutting advances from current levels could well be very sensible -- then we can expect a few big authors to take matters into their own hands in the next few years.'

Once you've absorbed the Shatzkin wisdom, you will probably feel a little battle-weary. But when you get your breath back, here are a couple of links to articles which tie up with the Shatzkin world-view rather neatly.

First, Andrew Gowers in the Sunday Times explains why Hollywood is about to repeat all the mistakes made by the music business in the past five years. This is an old and familiar story now, but it seems to be taking rather a long time to sink in. It's what's known in the business world as 'marketing myopia': i.e. an industry thinks it can dictate to customers how the industry will deign to deliver the product, rather than concentrate on delivering the product to customers in a form which they are clamouring for.

Gowers, by the way, doesn't even mention the book business. But that's because books generate so little profit, or even turnover, by comparison with serious businesses, that hardly anyone bothers to notice what the book world is up to.

Next, the UK publisher Laurence Orbach bemoans what he describes as the UK book retailers 'collective death wish'. (Remember what I said above, about an industry preferring death to change?)

And third, Nigel Newton, the chief executive of Bloomsbury, proposes in The Guardian (link from booktrade.info) thatwe should all boycott Google in protest against its plans to scan books. In the UK, this is what passes for cutting-edge thinking. What do we need with Shatzkin, when we have visionaries of this quality in the UK? Oh, and by the way, if anyone from Google should read this, Please scan in all my books. Please?

Finally, what are the implications of all this for writers?

Well, it seems to me that anyone who sees writing books as a 'career' should think again. This seems to me to be true whether you're interested in fiction or non-fiction, but particularly fiction. Writing can be fun -- if approached in the right way -- and also rewarding. But don't look to it to pay the rent.

6 comments:

Yep, knees knock over at PW at the thought of offending anyone, particularly an advertiser.

Until about a year ago, I also felt PW was a big bore. However, I have sensed a change taking place since Sara Nelson became editor-in-chief. She comes from The NY Post, which is not known for being timorous. Did you read her essay about Random House and Focus Films three weeks ago? Pretty daring until the end when she must have had an anxiety attack about offending someone in a high place. Still, the tone of the essay surprised me. It showed guts.

Sara Nelson also allows comments from her readers at the end of her essays. That's new and brave, although there is rarely a response. Fear is endemic to the publishing industry.

Very perceptive commentary by Mike Shatzkin : it should be read by everybody in the booktrade. Bertelsmann would probably dispute that book clubs are an endangered species. The opinionated old farts, like myself, who own quality bookshops are going to fight to try and ensure continuity for terrestial bookshops ; thankfully, most of us have a very loyal local customer base, but the next three years is going to be quite a challenge.

Michael, I must commend you on an excellent article. If only The Observer could have included such an insight review rather than the (populist) most powerful top 50 in British publishing.

Thanks very much for the very generous characterizations of the speech and of me.

I just want to add one thought to the commentary. The reason I think advances to big authors MIGHT be investments of concern is because I fear big books suffering mal-effects from used book sales. That is: leading the target by a couple of years (as publishers often must) and paying an advance based on a high estimate of what the book can sell (as publishers often do) could result in a series of problems down the line if used book sales start to relentlessly and progresively eat into new book sales. Which I believe they will.

I note this morning that Penguin is saying they will sign more unknown authors, books they can sign up for less . Although (most) publishers have very little consumer brand identity that matters, their brands and infrastructures definitely give them a competitive edge in the trade marketplace. If they can exercise that on behalf of authors where they have contract leverage, and if they use techniques (like branding web sites for the authors) that raise switching costs for the authors, they can build some equity into the future. And publishers definitely need that.

I want to support the notion that Sara Nelson, the current PW editor, is outspoken and a risk-taker. My observation that Publishers Lunch has overtaken PW in importance is not a commentary on PW's editorial quality versus Lunch: it's about the changes in the industry: digital and consolidation.

When I was a pup, you advertised in PW so that 3000 independent bookstores would know that you, one of many dozens of publishers calling on them, had a book you were really going to support. And that other stores would know about and likely stock. With consolidation of both publishers and booksellers, the reasons to advertise in PW are gone. That's not the fault of their editorial; it is the nature of their circumstances.

At the same time, Cader identified that the reporting mechanism needed to be a community mechanism; thus Publishers Lunch begat Publishers Marketplace. And Cader's deal reporting mechanism, by which agents and editors provide the "content" his community is looking for, was a stroke of genius. Now he had a database of deals going back many years that nobody will ever be able to catch up with. And, therefore, he "knows" more about editors and agents than anybody else (and you can find out for yourself on his site.)

That and other tools he's built to track reviews, bestsellers, etc. ARE the reporting of the 21st century. He's built a structure that works commercially, NOT based on publishers advertising at high prices for reasons that died 20 years ago. THAT is PW's problem, not the quality of their reporting or editing which, I believe, have only gotten better since Sara Nelson arrived (and were not the reason for their troubles before she came, anyway.)

Well, I'm not too happy with Publishers Weekly right now. I just went over to add a comment to Sara Nelson's essay of March 3, 2006, Baron's Estate, only to discover I have to be a subscriber now to make a comment. That's brand new. I can read the two comments that appear (sycophants unite), but those of us who used to get friends to sign up for the free trials to gain temporary access (hint, hint), and/or thumb through PW at the library, have had the door slammed in our faces! (Again!)

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